tv Bloomberg Technology Bloomberg May 2, 2017 11:00pm-12:01am EDT
alisa: i'm alisa parenti in washington. you are watching "bloomberg technology." president trump says the nation "needs a good shutdown," to fix the mess in the senate. he tweeted the country needs to either elect more republican senators or change the rules to 51%. suggesting more rule changes ahead in the senate. a vote is expected this week on a bipartisan budget deal. meantime, house speaker paul ryan says he understands the disappointment behind the president's tweet, and he didn't sabotage gop efforts to repeal obamacare. ryan also endorsed the potential $1 trillion spending bill, saying the budget increases
for border security make the u.s. a safer country. hillary clinton says she is taking responsibility for her loss, but believes misogyny, russian interference, and questionable decisions by the fbi also played a role. she spoke at an event today saying she was on the way to winning until a combination of events in the final days. screenwriters in hollywood have averted a strike that could have cost billions. the writers guild says writers will get more money for paid-tv and movies and studios will pay more for a health plan. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. from washington, i'm alisa parenti. this is bloomberg. ♪ emily: i'm emily chang back here
on "bloomberg technology." it is great to be back. coming up, apple declares numbers in the markets most viable player misses on revenue. we break down earnings for the second quarter. plus, microsoft officially launches its laptop to battle google and apple for classroom supremacy. we will discuss the new service laptop with a top exec. and a sitdown with the twitter cfo and ceo with anthony noto, about the company's latest media deals and capitalizing on trump. first, to our lead. apple earnings falling q2er hours after reporting revenues falling short. the iphone has always been the moneymaker, but sales were flat year-over-year. not surprising, given the anticipation for the next iphone this fall. we are expecting a big design overhaul. apple also announcing it generated over $7 billion on revenues on services. 18% growth from a year ago quarter.
this is the sector ceo tim cook says he expects to double over the next four years. joining me to dig into the earnings, david kirkpatrick. great to see you. in new york, angela is with us, analyst at cfra. she has been listening in to the call. i want to start with you. let's talk about the iphone. of revenuesg 2/3 for the company. are you concerned that sales were flat? >> know, when you look at the quarter overall, it was mixed. the one negative was the iphone numbers. but it's one of those quarters where you can only put so much emphasis on the iphone. you of course have the major launch later this year, and we think the entire miss here can be attributed to the fact that consumers are holding off for the next generation iphone device. overall, you are seeing a little bit of a hit on the stock price,
but it is something we would look past. emily: i spoke with apple cfo luca maestri who spoke of channel inventory. they sold 1.2 million iphones worth of channel inventory. that brings the number slightly up. david, what is your take? >> if i understand correctly, the sales outside of china actually grew. cook said it is because they were seeing anticipation of future product being a problem. it's amazing to me how in china they are even more status conscious and technology conscious than any other part of the world and they love apple. but i tend to take a big picture view. this is not that big of a deal. if this company can make the move to services and software, which is the shift they have to make to get there multiple up, they will have a wonderful future. i do think they will come out with a great phone in the fall. emily: let's talk about china
and we saw a 14% year-over-year decline in china. i talked to luca maestri, and he played up the positive things they are seeing. he says the iphone 7 was the best-selling smartphone in china. the iphone 7 plus was also doing extremely well. there services business hitting an all-time record, max business growing double digits. he also expects performance to improve over the fiscal year in china. the second half of last year, they saw a greater decline than they have seen so far in the first half of this year. angelo, talk to us about what is happening in china and whether or not you are concerned. >> when it comes to china, consumers are of course a lot more price sensitive. i think you have a lot more options coming out of china, given the emergence of many device manufacturers in the local china region. that being said, when you look at how apple has recently performed in the mainland
region, they have actually done very well. it is more along the other areas greater china like taiwan, among other areas, that has taken a hit for apple. but overall, when you look at the segment, at least it is performing better than it did earlier last year. that is positive. we do think that business starts returning to growth as you progress later into the year and start seeing aesthetic changes to the next generation device. emily: overall, you are also seeing a greater shift to the larger sized iphone. luca maestri pointed out this is the first time at the iphone has a dramatically updated feature in the camera. the fact the more customers are buying the bigger phone, means the average selling price of the iphone is going up. i want to talk about what's going on with capital. they boosted the share buyback program, boosted the capital return program but there's , speculation about whether or not apple will bring cash back to the united states. $257 billion apple has in cash overseas.
there is a big question about what is going on with the trump tax plan and whether or not that will impact apple. what are your thoughts on this, david? >> i continue to be amazed that a company could be this big, this profitable, and have problems like they have. i think they will need to be seen as patriotic. if there's a chance to bring money back, they will do that. to me, the real -- i would go back to what i said before. if i was an investor in apple and i know some analysts have recently been talking about this, can they shift to be seen as more than just a device maker? their multiple is so low compared to facebook and google, that somehow they have to find a way to change that delta. they don't even need to make very big of a difference for their stockholders to see an incredible increase even from this astonishing $750 billion
market cap they have today. they will bring money back. if they have $250 billion to play with, it is astonishing. but the bigger questions are longer-term. emily: we did ask luca maestri whether or not they have laid the groundwork or are planning to bring cash back depending on , what happens with legislation. it is not something to speculate on right now because it depends on the details of what might get enacted. we do a lot of scenario planning, but there's nothing to announce today. any closing thoughts? >> i think when you look at the numbers overall, we remain very optimistic on the shares. services growth of 18%, right in line with what we expected, continuing to run in line of the doubling potential over the next four years. to the point that was just referenced, as apple continues to expand outside of the iphone
revenue stream, and i think that's an enormous positive. it will come from the services business. emily: angelo zino, i will let you get back on the apple earnings call. it has just started. tim cook is speaking. we will continue to monitor the headlines. angelo zino, analyst at cfra, and david kirkpatrick, you're sticking with me. staying on earnings, the company resort -- has first quarter results coming in better than expected, but the online marketplace is announcing a major restructuring. ceo josh silverman is leaving the company along with the chief technology officer. the company cutting jobs. shares are skidding after-hours trading on the news. advanced micro devices turning in its worst performance in more than a decade in tuesday's session. the stock tumbled 24%. coming up, we speak with microsoft's corporate vice president of devices. this is bloomberg. ♪ emily: we are continuing to get
updates on apples third-quarter results. ceo tim cook is on the call saying he feels great about this quarter's performance and the services business is on its way to becoming a fortune 100 company. he says app store revenue is up 40% year-over-year, and developer numbers are up 26%. we will continue to monitor headlines as they come in. it is back to school for microsoft. the tech behemoth has announced the launch of its new surface brand of device, surface laptop. it is aimed at college students loyal to apple, and it is a departure from the surface book. mark gurman got a peek at the new device. take a look. reporter: this is the new microsoft surface laptop. we got an exclusive sneak peek.
this laptop can shake up the market with its $999 price point, and a blend of new technologies and cool look. it is lighter than the macbook air, coming in at 2.76 pounds. it's also draped in durable fabric that you normally find in high-end cars. there's even battery life that beats macbook air by a couple hours. >> we want to not worry about bringing a power cord with you. not worry about battery life at all. reporter: the surface laptop comes with a new operating system, windows 10s. the s also comes from the world of cars, a nod to luxury. windows 10s is optimized to the new device. microsoft says it will not go down the computer overtime and gets you to work quickly. >> if you are from a dead power down state you can turn it on , and feel it right away. reporter: while they have pro touch on the market with detachable keyboards, and surface book, the surface laptop
is microsoft's laptop. first. they have a lot of options. you can boss around quintana. it has touchscreen like a surface tablet. >> if you have a surface been you can use it on this product. reporter: it also has a funky new mouse you can use separately. i don't think most people would need it. >> this is the new mouse meant to go flat. if you want to put in your pocket or bag, you can do so. it turns off, so it saves you battery life. it is bluetooth based. when you put it on, it integrates with your product. emily: that was our bloomberg technology reporter mark herman. joining me in the studio is microsoft corporate vice president of devices and services, yusuf mehdi. great to have you back here on the show. tell me about this new laptop. why can it take on chromebook? >> one of the things we are excited about with microsoft education is a couple new things. a new version of windows is designed to be more streamlined, simple, and give you better performance. it is called windows 10s.
a range of new devices from partners, starting out at $189 with an hp stream, giving you things like pen touch inc. and the ability to run minecraft. and further up, it's the perfect balance of personalization and performance in a 14.5 hour, 2.5 pound book. what windows 10 as does, it is all of windows as you know it. vr, 3-d, pen and ink, but also the apps that come from the store, but none of the drawbacks of chromebooks. you get to work off-line. 4.4 billion people in the world do not have internet connections. you get full office. you get the ability to run minecraft. you get rich experiences. i think it leapfrogs the
chromebook. emily: do you think you can get a share of the college kid market? >> i think it has better value and battery life than any mac. it is faster and thinner. it is also -- the combination of all those things with windows, it is differentiating. emily: apple fans might say they are not so fond of the features of windows 10s. what do you say to those people? >> the good thing is, with competition you can choose. apple makes great products. we admire that. with windows 10s, you can do things you cannot do on other -- apple products. virtual reality is happening on windows, that is 3-d capability. if you like touch and 10, those are unique. emily: surface sales declined considerably. it is getting a little old. what is the hardware strategy? >> number surface creates new one, categories of computing. you see that with surface books,
studio, and pro. what we want to do is grow the overall windows ecosystem. hp, dell, lenovo. that has happened. if you look at the last year, we have grown. the last quarter we have seen more price competition. we are in the middle of a transition. the surface laptop is new today. you might expect to see an update coming soon. emily: the ceo of microsoft said cloud first. cloud seems to be going really first well. give me the progress on mobile first. >> we are all in on mobile in the sense that all of our software will run on any device you own. office will run on iphone and android. minecraft will run on iphone and android. our management tools run across all those devices. we embrace the world as we see it today, which is that people use multiple devices and use windows pcs, laptops, and notebooks. emily: windows 10, give us an
update. >> it has been doing great. we had over 400 million monthly active users 300 million plus , use it every day. it is the fastest adoption incorporations ever seen, and we are seeing great deployment. new applications are coming we , couldn't be more thrilled. emily: yusuf mehdi, thank you, microsoft vice president of corporate services and devices. coming up, the india based tech company plans to hire u.s. u.s. workers as president trump overhauls the h-1b visa program. we look at the political and business ramifications next. we are continuing to get updates on apple's third-quarter results. tim cook is still speaking right now, saying there has been strong growth in beats sales. is the from a wearables size of a fortune 500 company. this is bloomberg. ♪
emily: a story we are watching, looks like jared kushner, president trump's top adviser and son-in-law, omitted a few items in his government disclosure forms, namely his stake in a real estate tech company. according to the wall street journal, kushner omitted his stake in a company that had ties to goldman sachs and george soros. a revised version of the disclosure form that includes cadre will be made available once ethics officials have looked into it. india-based infosys plans to hire 10,000 americans in the next two years. the hires are part of the outsourcing plan to open four tech and innovation hubs in the u.s. focused on artificial intelligence and machine learning. there is criticism from the trump administration at outsourcing firms are unfairly taking jobs from u.s. workers. joining us is "bloomberg technology," editor at large cory johnson.
just hanging out. and david kirkpatrick and washington, d.c. david, you are in on the party. we will make sure to include you. what is going on with infosys? cory: politics. this is about politics. this is an attempt for emphasis, one of the largest consumers of h-1b visas, to get themselves on the right side of the story. it has been going on for quite some time. as one of the reasons president trump was able to become president, capturing this notion of something gone awry with the american workforce. .he media calling out infosys people in the far right media are calling them out as a company stealing american jobs. it is no accident with 10,000
, people being hired in hubs, especially in indiana, that is a place where president trump won and vice president pence hails from. they want to make a mark for that reason. emily: i know you are looking at the numbers at other companies affected by the h-1b visa policy changes. cory: outsourcing firms are big consumers of h-1b visas. there are bigger known companies like intel and apple. we look at the numbers the , biggest consumers are outsourcing firms. we have a graphic that demonstrates how these firms are among the biggest consumers of the h-1b visas. emily: what jobs are they doing? cory: they are doing all kinds of jobs. but there's a concern that jobs are replaceable. they are not unique jobs. when you have companies you can see from tata, infosys, that these are the kinds of jobs, like tech support jobs, they are not inventing the next driverless car or optical semiconductor, but it is a tech support kind of job filling these h-1b visas.
this can be seen as an announcement for announcement's sake. emily: david, i know you are thinking about this. >> i think cory is right. as a political move, but it is justifiable. this program has been abused. this isn't one where donald trump has it right. these companies are bringing in people and paying them less than they would for american jobs. american workers make something like $50,000 a year more on average than indian outsourcing firms. even if you are coming in from other countries, 70% of workers on this program are coming from india, even under those circumstances, you will make a lot more working for an american company. indian companies have a serious perception problem they have to address. it doesn't surprise me in the slightest of that infosys is doing this. emily: how competitive is h-1b visa program? cory: enormously competitive. there are more applicants than
there are spots available. it is a way for some of these people to get green cards and be in the country. we have friends who followed that route. we have bloomberg intelligence analysts who have done that. fundamentally, what we might expect our changes to the h-1b program to fix these problems and the problems of workers getting paid less, coming here and being stuck with these jobs. it is a way for companies to increase their margins, but it's not a way to a better life or for america to continue to lead in technology. emily: this is something mark zuckerberg has personally taken on, trying to get more "skilled workers" into the u.s. how does this affect facebook or google? >> it doesn't directly affect them that much, but i think what will affect them is if we can find a way to open up the doors to allow more people to come in to do a variety of jobs that are needed with fewer restrictions, while still being able to protect american jobs.
that is a tough balancing act. all the big tech companies absolutely feel they would benefit and the american economy would therefore benefit, if they could bring in more people from outside the u.s. this program was not so severely restricted. cory: every time someone graduates from stanford, they should staple a green card to the diploma, as john doerr said. there are workers they can really benefit the economy. this anti-immigrant notion about stealing jobs, particularly in technology, and it is an issue. people want to start businesses and change technology but they are not given a chance. emily: cory johnson, bloomberg editor at large, and david kirkpatrick sticking with me. we'll talk more about apple. also, twitter rolling out serious plans to livestream content in news, music and sports. our extended interview with cfo and coo anthony noto is next. plus, we recap the stories of
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xfinity x1 gives you exclusive access to the best of the billboard music awards just by using your voice. the billboard music awards. sunday, may 21st eight seven central only on abc. >> it is 1:20 ninth in sydney in hong kong. i am paul allen with the first word news. china's hna group has raised the stake and deutsche bank to almost 10%. the conglomerate first reported a 3% holding in february, saying it might increase that the wants to maintain below 10%. holding the black rock investment, which had been the largest taken deutsche, according to data compiled by bloomberg. new zealand's unemployment rate fell more than anticipated in the first quarter, returning to its lowest in 2008, thanks to the expanding economy. it dropped to 2.9% from 5.2%.
the median forecast was 5.1%. employers can offer jobs without big pay increases. wages are rising at the slowest pace in seven years. atgapore-listed mobile group a seven-month low ahead of next week's stock consolidation. they are concerned if they will be able to overcome years of setbacks. shares have fallen slip -- sharply again today, having fallen 10% on tuesday. 11.2are dropping toward cents, the lowest since 2003. the slump in the u.s. auto industry shows no sign of letting up. the sales of all six of the biggest carmaker's falling in april. ford and honda posted the steepest year on year decline, and gm sales fell him a 6%. chrysler, almost 6.6%. formed theare prices
closing at its lowest in four and a half years. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. emily: a little in the way of themes, major markets up. investors are waiting on tonight's fmoc decision. poor result, there is mixed reaction in asia. mostly shirking off apple's this, and take a look at apple suppliers in taipei. they look of mixed as iphone sales fall before the next upgrade. are looking at the next iphone-like assembler. aussie stocks headed for the biggest loss since march. weaker iron ore. the ringgit rising for a six
today. he likes the ringgit, but be wary of the kiwi, but is rising after today's it jobless data came in better than expected. ♪ emily: this is "bloomberg technology." i'm emily chang. let's get back to our top story. apple's second-quarter results. the stock casting a huge shadow over the markets. it is the top performer in the dow this year with a 27% gain. wall street analysts have 39 buys on the stock, and gina barton adams, chief equity strategist at bloomberg joins us now. we have been watching earnings, up 27% year-to-day. is it worth it? reporter: i guess investors are willing to pay for it. it is one of the strongest performers in the tech sector and broader markets. it's interesting because investors seem to be looking forward to better times ahead.
when you look at apple's results over the last couple of quarters, they actually seem to be losing a bit of their punch on traditional earnings and revenue. if we look at apple's share of the index, it actually peaked several years ago. it has been on a comeback as investors have piled back into the stock, but i think the company has a lot to prove with earnings. emily: i want to take our audience into the bloomberg and show a 10 year chart. just how heavily weighted apple is within the nasdaq. it is such a massive company. any small move could have such a big impact on the market. talk to us about that. reporter: within the s&p 500, it is the largest stock and holds the most cash. it has the largest earning shares. from a number of angles, when apple moves, the market moves. we saw that a little bit today, but luckily for us, it is a bit more diversified. nasdaq is a tech index. in there,ome biotechs
but it is a tech index. in the s&p 500, tech is a big part, but not the entire index. it does tend to move the broader market but a little more at the , s&p. emily: apple moves 4.7% a day on average. reporter: what i can say is that tech stocks so far this season, what stands out is that tech stocks that guided lower on sales have been punished by the market. the fact that apple missed on revenues and the guided revenues expectation is lower could be troublesome for the stock tomorrow. otherwise, i think investors are looking to the earnings season and better times ahead. emily: we have facebook and tesla this week. two companies with a lot of exuberance around them. what are you watching? reporter: more tech. lots of tech.
considering what happened with auto sales earlier today and first quarter auto sales in the gdp report last week, it is interesting to see tesla is doing as well as they are. relative to the rest of the auto industry. i think it is a tech play. you have this sort of uptrend for all tech companies across the index, and the rest of the index has skittish performance. i would lump tesla in with tech. pressure is on the company to guide for better expectations going forward. emily: thank you for stopping by. twitter wants to be the place to go for all of your life video needs. the social media company announced it would be expanding its live streaming portfolio with 12 new partners in news, music, and sports. they have 16 deals overall. bloomberg news is among the video partners. i spoke with coo and cfo anthony noto about the deals. take a listen. >> we started our live experience in the fall 2016.
we had two quarters of great success. on the back of the earnings on the back of 2017, we decided to go all in and push hard with partners to take live streaming content to the next level across sports, news, and entertainment. we will build on the 800 hours within q1. it is aggregating a large army -- audience. we are seeing great activity with the conversation on twitter. live it makes us better, faster, gives us more comprehensive selection, drives discussion, and we can personalize it for the individual. we know their interests based on who they follow. it is perfect for twitter and we are delivering a unique experience. i think these 16 deals are real testament to the success we have with this product great quality , video, and the conversation on twitter about that event. emily: let's talk about the video ad strategy. what are the biggest growth opportunities and how do you scale? >> it starts with the audience.
what does the audience on twitter want? for 11 years, the audience on twitter has been talking about live events as they unfold and tv. we want to bring that video on the screen with a great conversation on twitter and consolidated in a one screen experience. that drives more selection and discussion. we thought that throughout the fall and first quarter of 2017. we want to take it to the next level. we want to take into to a dependable place where people can see was happening in news, entertainment, and sports. these deals reflected that dependability. with bloomberg, we launched a 24/7 network launching in the fall. it leverages the strength of both of our companies. with stadium, we announced a 24/7 linear sports network. live games, live news analysis, highlights and guests. emily: you said it would be a long road to revenue growth. when do you see training revenue -- turning revenue around? >> today, we don't have visibility. i am seeing revenue trend improve.
that is based on a number of factors. we need advertisers to recognize the significant increase we have driven in r.o.i. it is more attractive than it was six to 12 months ago. they made their decisions on what they would spend today. not only is the audience accelerating for the fourth consecutive quarter to 14% growth in active users, prices are down 60%. r.o.i. has improved significantly. we need to grab them and get their attention so they see that. part of today was making sure they understood that significant improvement. the second part of today is how can they be a part of what's happening? we think we are unique in that way. twitter is what's happening. we also have an audience of influencers and audiences leaning forward so the brands can become what's happening. emily: let's talk about user growth. that has been a bright spot. you added 9 million users last quarter. where's the growth coming from? donald trump? >> the primary factor was organic growth seasonality, and , the second was product and
marketing. product has impacted growth for the last four quarters. it has been a long time since that has been the case. in the first quarter, the product improvements was the largest contribution it has had to growth in a significant period of time. we can't say whether or not the increased focus on politics and newsworthy events is driving growth, because we don't have a hold to measure that, but we did analyze correlated factors. there was an increase in users and accounts that fell into the news and politics. but beyond that it is hard to measure. emily: is there anyway to give -- any way to give us more color on whether it is the president using the platform itself, or his followers, or greater engagement with the president? >> i would say product and marketing has been a consistent trend on the acceleration. we will continue to analyze the data. twitter benefits when influential people in the world
use our platform to tell what is happening. we encourage that. we love the discussion. we love the conversation that's happening. the more it happens, the better we can be at showing you was happening in the world. we would love it if every world leader used twitter as a primary mechanism to talk to constituencies. emily: twitter is working hard to crack down on abuse and harassment. it is still a problem. i can say that as a woman using the platform. i'm often on the receiving end of it. why should someone like me stick around? >> our number one focus was to make sure we made twitter a safer place for everyone. we understand twitter is a microphone to the world, but it has to be in an environment that is safe, or people will not use the microphone. we have made great strides in the first three months of the year. it is a focus that will continue until we get it right. we have had significant improvements. we talked about that on the earnings call, as well. jack talked about the improvements. emily: do you see any re-evaluations and what counts free versus hate speech, and where twitter draws the line?
>> we have clear-cut rules, but there are things that will be gray, and we need to make the best judgment. we want to make sure it is a safe place for the audience to engage and we will continue to reinvestigate and reevaluate things to consider changing. emily: as you are striking streaming deals, it is almost more important than ever to make sure the content going on the platform is not hateful or abusive. what kinds of new mechanisms could you see down the line to further police that? >> we have already provided tools for users themselves, such as being able to mute words that you may not want to see on your timeline. you can also block and report much easier. we have abilities to give you safe search, which eliminates things you may not want to see. within the live experience, we are expanding not just live video, but machine learning technology and algorithms to deliver the best tweets about that topic. we are making sure what is seen
on that timeline and making sure it is appropriate for the content on the platform to make sure it is. emily: sources told me your kind of the soul of twitter right now. we know you have been working really hard. how is twitter navigating some rough patches, how would you describe how you are putting your job as coo and cfo? explain this idea of being the soul of the company? >> first i would say i love working with jack and the rest of the team. we approach running the company as a team. we dividing conquer as those priorities. titles are what the world decided our responsibilities are, but at the end of the day we divide priorities amongst the what is -- what is most important to accomplish. i would not want to work with anyone else other than the team i'm working with right now, including jack. he's an inspiration. no rehearsals, no script, jack stood up and delivered the heart and soul of what twitter is.
i live and breathe every day to help that vision come to life. that is what has made twitter so special the last 11 years. he couldn't be a better partner. our teammates cannot be stronger. emily: what is it like working with a guy who is ceo of another company? it can be daunting and inspiring. jack is therefore 100% of the decisions. he's had to make decisions that no other executives has had to make. is a powerful relationship and has made us better in the last two years. emily: on that note, we talk about the potential drawbacks of running two companies. are there any benefits? >> the media wants to ask us about having dual roles. i don't ever think about it until the media asks me. when i have something to talk to jack about, we talk about it. we are together for 100% of decisions. at the end of the day, that is what running the company is about. emily: you are still looking for a cfo.
any progress? >> once we have news, we will share it. emily: that was the twitter cfo and coo, anthony noto. coming up, we have coverage from the milk in the conference. the rise of automation and his thoughts on trump. we are staying on the story of apple quarter earnings. ceo tim cook speaking on a call on the enthusiasm around china despite decline in revenue. this is bloomberg. >> first-half revenue is down 13% year over year. about one third of which was the trip -- attributable to sa. that is in contrast to 32% revenue decline in the second part of last year. march quarter results were in line with expectations, and similar to the year-over-year performance we experienced in the december quarter. we continue to be very enthusiastic about our opportunity in china. ♪ emily: to our continuing
coverage from the annual milken institute coverage in beverly hills, california. scarlet fu caught up with box ceo aaron levie on his thoughts about the trump administration and the rise of automation. take a listen. >> we have a lot of cause for concern and to be talking about this subject of technology-based automation and what happens to employment as we have new innovations like ai, robotics, and other advancements. we do have to be concerned about it because we have to think about what does the future look like in 10, 20, 50 years from now, no matter what the industry. in general, i personally, and a lot of technology companies, are optimistic that we will create more jobs in new industries that
we cannot even perceive. the challenge is figuring out how do you transition in as smooth the way as possible to those jobs? we know the jobs that go away or that are reduced, we don't always know what the future jobs are like. we don't know what to prepare people for in the future. in general, it is a healthy conversation to be having. i think we need to ease away from being on both sides of the pendulum, all jobs go away or there will be a massive boom, and think of the nuances of how to prepare for a long-term transition to a new economy. reporter: what is the most likely path for automation and machines taking only some of the jobs in the next two or three years? >> in the phase we are in where we help businesses share and collaborate and work on information in new ways you'll , see a lot of automation in
intelligence and software that makes us more efficient. we can do more with our time in the workplace or outside the workplace, and we can make decisions more quickly we can , collaborate and connect ideas more rapidly. it will ultimately have the impact of moving us into the future faster. it won't necessarily replace specific jobs as much as really increase the speed and scale of what we can do in our organization. over the more medium and long run, i think you will have some discrete jobs that are made more efficient that you have fewer of them in the industry. we are talking a lot about the roles that go into shipping and logistics, or taxi drivers. at the same time, as soon as you make one of those industries more efficient, consumption increases of the services, which creates ancillary and adjacent markets that see an increase in jobs. the question is, if we can make things like shipping and logistics more efficient because it costs less, maybe you bring even more manufacturing into
america, because the delivery speeds of services is so vast that we want to manufacture things as close to the buyer as possible. that create a new set of jobs in the manufacturing industry. we have to look across the whole system as opposed to the individual job that will be replaced or displaced. reporter: you have been very vocal in your opposition against donald trump and his policies before and after the election. what are your biggest concerns about how his policies impact technology, and your company specifically? >> our biggest concern is really at the policy level. we want to make sure that we have a structure of our industries in the government that works for the next 10, 20, 50 years of the economy. we have to recognize the economy will look very different than it does today or how it did 10 or 50 years ago. it will mean a number of things.
it will mean different industries will have to have modern digital policy applied to the industry like life sciences or the automotive industry, or aerospace. we need to look at modern ways to regulate industries to unlock as much innovation and growth as possible. secondly, we have to make sure we are bringing in as much talent as possible into the country that helps us build innovative companies. and we have to make sure we can grow as much talent from within as possible. those are things like like stem education, job retraining programs, and we have to make sure there's a message and long-term roadmap of how to get the country there. we need to understand the philosophy of the government, and what we collectively understand the future to look like. that's another thing from a communication standpoint that hasn't happened from this administration. emily: a quick programming note. coming up on bloomberg television, radio wednesday. tom keene sits down with a conversation with former fed chairman ben bernanke.
look for that live 12:30 p.m. in new york and 5:30 p.m. in london. we continue to monitor the apple earnings call earlier. ceo tim cook gives his outlook on wearables, saying the apple watch sales have doubled year-over-year, calling it the best-selling smart watch in the world. this is bloomberg. tim cook: if we combine apple watch, air pods beats , headphones, our revenue from wearable products in the last four quarters was the size of a fortune 500 company. ♪ emily: we are continuing to
cover apple's second quarter earnings report, the world's most valuable company sitting on a quarter trillion dollar war chest. i have a chart here on the bloomberg. the massive cash pile, 2050 $7 billion in cash 90% of that overseas. , investors speculate that apple and other cash-rich companies may bring cash flow home under a tax plan from the trump
administration. the cfo told me whatever happens depends on the details of what might get enacted. they do plan various scenarios but there is nothing to announce today. let's look at how the stock is trading after-hours. apple shares trading lower. iphone sales coming in below analyst expectations. customers are holding onto iphones longer, likely waiting for the iphone eight this fall. we are expecting a big design overhaul. potentially a new screen, better camera. the ceo tim cook says he thinks people are waiting for the new iphone. on tap is wednesday, earnings from facebook and tesla. both stocks have seen massive growth this year. we will have coverage and reaction throughout the show. that does it for this edition of "bloomberg technology." on wednesday, we hear from venture capitalist and the co-owner of the golden state